Renting in Sydney just as unaffordable as buying a house

Some renters living in the inner-suburbs of Sydney are spending nearly half of their wages on rent.

RentsRising rents and stagnate wages are pushing thousands of Australians from all walks of life into housing stress as more of the weekly budget is soaked up by costs of living.

Spending over 30 per cent of an average weekly wage on rent, classifies  renters as under housing stress.

And the recently released Australian Housing Income Gap Report (AHIG) released by Compass Housing Services today has found that even Australians with well-paying jobs are struggling to comfortably afford rent in inner-city properties.

The AHIG is calculated by subtracting the median weekly household income of renting households in a particular area, from the weekly household income required to pay the median rent in that area without exceeding the 30 percent affordability threshold.

Let’s look at some figures

In some inner-city locations in Sydney, a renter would need an income of at least $2,333 per week, ($121,333 per annum) to afford a two-bedroom apartment without falling into housing stress.

Now that puts it out of reach of most civil engineers (earning on average $110,819 a year), solicitors ($102,432 a year), police officers ($99,812 a year) and accountants ($77,318 a year).  

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The report’s author Martin Kennedy said: 

“To avoid housing stress in Sydney, Melbourne or Brisbane, a typical renting household often has to choose between living a considerable distance from the city or living in a one-bedroom apartment,”

“Neither of those things are practical for lots of families so they are effectively forced to accept living in housing stress.

“This can have a real impact on living standards because people in housing stress are less able to pay for other essentials like food, utilities, insurance, healthcare, childcare, and debt repayments.”

Top five most unaffordable suburbs in Greater Sydney*

Rank: Suburb: Median Rent: Income required to avoid housing stress: Actual median household income: AHIG**
1 Woollahra $800 $2,667 $1,814 853
2 Waverley $750 $2,500 $1,814 686
3 Northern Beaches $675 $2,250 $1,814 436
4 Hunters Hill $660 $2,200 $1,814 386
5 Ku-ring-gai $660 $2,200 $1,814 386

*Based on the gap between median rent and median income for the same area

**Affordable Housing Income Gap

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About

Ahmad is Director of Metropole Properties Sydney and a highly skilled wealth strategist. He is a passionate property investor, has a degree in Commerce, is a licensed estate agent and qualified property investment advisor and has personally coached and educated hundreds of clients to create wealth through property.
Visit www.SydneyBuyersAgent.com.au


'Renting in Sydney just as unaffordable as buying a house' have 2 comments

  1. Avatar for Property Update

    September 7, 2018 Michael Correll

    Always plenty of money for beer and skittles – not to forget cigarettes and new phones with their fancy plans.

    Reply


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